A massive surge in liquefied natural gas (LNG) supply is set to hit global markets in 2026 and 2027, raising a key question: where will all this extra gas go?
According to a recent commentary from the Oxford Institute for Energy Studies (OIES), global LNG export capacity will jump by 113 billion cubic meters (bcm) over these two years – rising from 593 bcm in 2025 to 707 bcm in 2027. This marks the start of a broader wave expected to boost supply by 50% by 2030.
After the impact of the Covid pandemic in 2020, the global LNG market has been very tight, starting in 2021 as the world economy recovered from Covid and lockdowns, followed by Russia’s invasion of Ukraine in 2022 and the loss of most of Russian pipeline gas to Europe. The tightness continued through 2023, 2024 and 2025. The average utilization of LNG export plants between 2021 and 2025 was over 97 per cent, using actual effectively available LNG export capacity.
Between 2025 and 2030, LNG supply is expected to grow by some 50 per cent, based on the Final Investment Decisions (FIDs) already taken plus a few projects anticipated to take FID in the next 12 months. A key question, being hotly debated in the industry, is where will it all go, and what impact it might have on global spot prices.
The growth comes from new projects and ramp-ups in key regions: North America (especially the US with facilities like Golden Pass and Plaquemines); Qatar (North Field East); Canada (LNG Canada); Australia, Russia, and others. In 2026 alone, capacity rises by 53 bcm, followed by 60 bcm in 2027.
Demand won’t keep pace. OIES forecasts LNG imports to grow by just 87 bcm over the period – 41 bcm in 2026 and 46 bcm in 2027. Asia leads this growth, driven by: China, South Asia (especially India), Southeast Asia (ASEAN countries like Indonesia and Thailand). Europe follows, with modest increases tied to declining domestic production and storage needs. Other regions, including bunker fuel demand, contribute smaller shares.
This leaves a 26 bcm surplus over two years. Much of it could flow into European storage, which ended 2025 lower than in previous years. Refilling tanks to pre-crisis levels may require aggressive summer injections – similar to 2019, when excess LNG filled storage and drove prices down.
The outlook points to downward pressure on global spot prices. Forward curves already show declines, from around $12.30/MMBtu in 2025 to $10.55 in 2026 and $9.30 in 2027. Risks remain: project delays or outages could slow supply, while weaker Asian demand might ease the glut.
The LNG wave has arrived. With Asia absorbing most new demand and Europe potentially stockpiling the rest, markets face a shift from years of tightness to looming oversupply – and lower prices ahead.
/Oxford Institute for Energy Studies (OIES), X/